2 Medical Stocks to Buy Now for Long-Term Resilience

NYSE: UNH | UnitedHealth Group Inc. News, Ratings, and Charts

UNH – Healthcare industry tends to perform relatively well despite macroeconomic headwinds, thanks to near-inelastic demand for their products and services. So, we believe quality medical stocks UnitedHealth Group (UNH) and Abbott (ABT) might be ideal Buys for the long term. Keep reading….

Recent studies show consumers’ concerns about high costs impacting their access to healthcare and increasing medical debt. A survey by Gravie and Wakefield Research showed that 86% of consumers are worried about their health benefits not covering a portion or all of their exams, treatments, or procedures for 2022.

However, despite the inflationary environment and macroeconomic uncertainties, healthcare companies tend to perform relatively well due to almost inelastic demand for their goods and services. According to the Centers for Medicare & Medicaid Services (CMS), healthcare spending in the United States is slated to expand at a 5.4% CAGR to $6.20 trillion in 2028.

Also, an aging population and a surge in chronic lifestyle diseases will likely keep demand for the medical sector high. In addition, according to the Labor Department, employment in the healthcare sector has increased significantly. The industry added 53,000 positions in October.

Given the backdrop, investors could consider buying fundamentally solid medical stocks UnitedHealth Group Incorporated (UNH) and Abbott Laboratories (ABT) for long-term stability.

UnitedHealth Group Incorporated (UNH)

UNH operates as a diversified healthcare company in the United States. It operates through four segments: UnitedHealthcare; OptumHealth; OptumInsight; and OptumRx.

On October 14, 2022, Andrew Witty, UNH’s CEO, said, “The strength of our performance reflects the diligence and determination of our colleagues to improve people’s experience across the health care system and make high-quality care simpler, more accessible and more affordable.”

UNH has paid dividends for 19 consecutive years. Its dividend payouts have increased at 17.7% CAGR over the past five years. Its current dividend yield is 1.26%, while its four-year average yield is 1.36%.

UNH’s total revenue came in at $80.89 billion for the third quarter that ended September 30, 2022, up 11.8% year-over-year. Its net earnings increased 28.7% year-over-year to $5.26 billion. Also, its EPS came in at $5.55, up 29.7% year-over-year.  

Analysts expect UNH’s revenue to increase 12.4% year-over-year to $323.31 billion in the current year. Its EPS is estimated to grow 15.8% year-over-year to $22.03 in 2022. It has surpassed EPS estimates in all four trailing quarters. Over the past year, the stock has gained 14.1% to close the last trading session at $522.08. 

UNH’s strong fundamentals are reflected in its POWR Ratings. The stock’s overall A rating indicates a Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

UNH has a B for Growth, Stability, Sentiment, and Quality. In the A-rated Medical – Health Insurance industry, it is ranked #2 out of 11 stocks. Click here for the additional POWR Ratings for Value and Momentum for UNH.

Abbott Laboratories (ABT)

ABT discovers, develops, and sells healthcare products focused on cardiovascular, diabetes care, diagnostics, neuromodulation, nutrition, and medicine worldwide. Its products are sold directly to wholesalers, distributors, government agencies, healthcare facilities, pharmacies, and independent retailers.

On October 19, 2022, Robert B. Ford, ABT’s chairman, and CEO, said, “Our results and increased guidance in the current macroeconomic environment reflect the strength of our diversified business model and execution.”

ABT has paid dividends for 33 consecutive years. Its dividend payouts have increased at a 12.1% CAGR over the past five years. Its current dividend yield is 1.81%, while its four-year average yield is 1.49%.

ABT’s net sales came in at $33.56 billion for the nine months that ended September 30, 2022, up 6.2% year-over-year. Its net earnings came in at $7.66 billion, up 9.3% year-over-year, while its EPS came in at $4.31, up 10.8% year-over-year.

Street expects ABT’s revenue to increase marginally year-over-year to $43.21 billion in the current year. Its EPS is estimated to grow marginally year-over-year to $5.22 in 2022. It surpassed EPS estimates in all four trailing quarters. Over the past month, the stock has gained 2.3% to close the last trading session at $104.09.

ABT has an overall rating of B, which equates to a Buy in our POWR Ratings system. It also has a B grade for Stability, Sentiment, and Quality. ABT is ranked #6 out of 141 stocks in the Medical – Devices & Equipment industry. Click here for the additional POWR Ratings for ABT (Value, Growth, and Momentum).


UNH shares were trading at $520.46 per share on Monday afternoon, down $1.62 (-0.31%). Year-to-date, UNH has gained 4.65%, versus a -14.81% rise in the benchmark S&P 500 index during the same period.


About the Author: Rashmi Kumari


Rashmi is passionate about capital markets, wealth management, and financial regulatory issues, which led her to pursue a career as an investment analyst. With a master's degree in commerce, she aspires to make complex financial matters understandable for individual investors and help them make appropriate investment decisions. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
UNHGet RatingGet RatingGet Rating
ABTGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


Bullish or Bearish Stock Set Up?

The S&P 500 (SPY) record highs sounds pretty darn bullish on the surface. Yet as we dig below the surface there are some curious signals that point more Risk Off. This is especially true as we come into the next Fed meeting after a round of data that points to inflation still being too high...only further delaying the first rate cut. What does this all mean for stocks from here? Steve Reitmeister offers his latest views on the market outlook along with a preview of his top picks to stay on step ahead of the market. Read on for more...

Unveiling Adobe (ADBE) Q2 Earnings: What Lies Ahead for Investors?

Software giant Adobe Inc. (ADBE) has released its second-quarter earnings, revealing double-digit growth in both revenue and profits. Yet, concerns arise around the complexities of navigating growth in the face of advancing AI technologies. Let’s analyze ADBE’s recent performance and assess key fundamentals to uncover what lies ahead for investors…

3 AI Stocks to Invest in for the Next Technological Revolution

The AI market is experiencing a significant growth trajectory, driven by widespread application across various industries. Hence, it could be wise to invest in top AI stocks, Alphabet (GOOGL), Meta Platforms (META), and Alibaba Group Holding (BABA) for the next technological revolution. Read more...

Analyzing Broadcom’s (AVGO) Q2 Earnings: Worth Investing?

Driven by a surge in demand for its AI products, Broadcom (AVGO) reported robust earnings in its latest quarterly results, exceeding expectations on both top and bottom lines. However, is the stock’s recent announcement of a 10-for-1 stock split worth investing in? Keep reading to find out…

Stock Alert: Breakout or Fake Out?

The S&P 500 (SPY) officially made new highs this week. Perhaps a reason to celebrate more gains on the way...or perhaps there are signs this move is hollow leading to more downside soon on the way. To help solve this riddle, 44 year investment veteran Steve Reitmeister shares his views along with a trading plan and top picks to stay on the right side of the action. That is what Steve Reitmeister will cover in his latest commentary below. Read on for more...

Read More Stories

More UnitedHealth Group Inc. (UNH) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All UNH News